Can money bring us happiness?

Many have researched the infamous money / happiness connection over the years. Certainly if you are struggling to afford the basic necessities in life then more money will substantially improve your situation, but many reports have found that above a certain income, more money doesn’t necessarily deliver more enjoyment in life.

In fact, recent studies have found that our pay packets have far less impact on our overall happiness than simply feeling in control of our finances and well-prepared for our future. To achieve this, Beacon IFA recommend looking at the four following dimensions:

1. Having control of your day-to-day finances : If you often find yourself short at the end of each month, look for areas you can cut costs. One often neglected area is a mortgage – did you know a quarter of us are on uncompetitive standard variable rates, and could save hundreds each month by switching?
2. Being on track to meet your financial goals : Do you have a clear financial goal such as retiring early? With a goal in place, you can analyse if you are on track – a worryingly high third of British people with a pension do not feel confident that they have the right pension provision in place.
3. Having the capacity to absorb a financial shock : It’s wise to save enough to cover 3-6 months of living expenses incase of a shock, as well as exploring insurance options such as critical illness cover. Beyond that, the right investment plan can add an additional level of financial security.

Having the financial freedom to enjoy life : Happiness in retirement can mean anything from travelling the world to helping children or grandchildren with with big purchases. However, often we have money tied up in our homes. Lifetime mortgages are one solution, releasing equity for you to use as you wish.

Financial control can clearly mean many different things to different people. To find out how you can personally gain greater control, Beacon IFA are offering free financial reviews to readers throughout October, covering mortgages, pensions, investments and more.